1. Instructions for 2008 Schedule DC
Purpose of Schedule DC Additional Information
Use Schedule DC to claim the special tax credits that For more information, you may:
may be available for persons doing business in Wiscon‑ • E‑mail your question to corp@revenue.wi.gov
sin development, development opportunity, enterprise
• Send a FAX to (608) 267‑0834
development, agricultural development, or airport devel‑
opment zones. • Call (608) 266‑2772 [TTY (608) 267‑1049]
• Write to the Audit Bureau, Wisconsin Department of
The Wisconsin Department of Commerce administers the Revenue, Mail Stop 5‑144, P.O. Box 8906, Madison,
development zones programs. To participate in one of WI 53708‑8906
these programs, businesses must first be certified by the
Department of Commerce. For more information regarding
eligibility in the Wisconsin development zones programs,
Part I – Development Zones Credit
visit the Department of Commerce web site at www.com‑
merce.wi.gov or write to the Wisconsin Department of
General Instructions
Commerce, P.O. Box 7970, Madison, WI 53707‑7970.
The development zones credit is the total of the following
Who Is Eligible to Claim the Credits amounts:
Any individual, estate, trust, partnership, limited liability
A. 50% of the amount spent for environmental remedia‑
company (LLC), corporation, or tax‑exempt organization
tion in a development zone.
that is conducting business in a development zone and
has been certified by the Department of Commerce may
Environmental remediation means:
be eligible for the credits.
• removal or containment of environmental pollu‑
Partnerships, LLCs treated as partnerships, and tax‑option tion,
(S) corporations cannot claim the credits, but the cred‑
• restoration of soil or groundwater that is affected
its attributable to the entity’s business operations pass
by environmental pollution in a brownfield, and
through to the partners, members, or shareholders.
• investigation, unless the investigation determines
Credits Are Income that remediation is required and that remediation
is not undertaken.
The credits that you compute on Schedule DC are income
and must be reported on your Wisconsin franchise or in‑
The removal, containment, or restoration work, other
come tax return in the year computed. This is true even if
than planning and investigating, must be begun after
you cannot use the full amount of a credit computed this
the area that includes the site where the work is being
year to offset tax liability for this year and must carry part
done is designated a development zone and after the
or all of it forward to future years.
claimant is certified for tax benefits.
Carryover of Unused Credits
Environmental pollution means the contaminating or
The development zones credits are nonrefundable. Any rendering unclean or impure the air, land, or waters of
unused credits may be carried forward for 15 years, with the development zone, or making it injurious to public
certain exceptions. health, harmful for commercial or recreational use, or
deleterious to fish, bird, animal, or plant life.
If you cease business operations in the development zone
during the taxable year, you may not carry over to future Brownfield means an industrial or commercial facility
taxable years any unused credits from the taxable year the expansion or redevelopment of which is compli‑
during which operations cease or from previous taxable cated by environmental contamination.
years. If your certification to claim tax benefits is revoked,
you may not claim any credits for the taxable year in which B. The total of the following amounts allowed by the De‑
your benefits are revoked nor may you carry over unused partment of Commerce for job creation or retention:
credits from previous years.
• The dollar amount, up to $8,000, multiplied by the
If there is a reorganization of a corporation claiming a number of full‑time jobs created in a development
development zones credit, the limitations provided by zone and filled by a member of a targeted group.
Internal Revenue Code (IRC) section 383 may apply
to the carryover of any unused Wisconsin development • The dollar amount, up to $6,000, multiplied by the
zones credits. number of full‑time jobs created in a development
zone and not filled by a member of a targeted
group.
IC‑132

2. • A person who is employed in a real work, real pay
• The dollar amount, up to $8,000, multiplied by the
project position (Note: Subsidies and reimburse‑
number of full‑time jobs retained in an enterprise
ments paid under the real work, real pay pilot
development zone under sec. 560.797, Wis. Stats.,
project must be subtracted when determining the
excluding jobs for which the former Wisconsin jobs
development zones credit as it relates to full‑time
credit has been claimed, and for which a significant
jobs created or retained.)
capital investment was made.
Specific Instructions
• The dollar amount, up to $6,000, multiplied by the
number of full‑time jobs retained in a development
Line 1. Enter the development zones credit for environ‑
zone, excluding jobs for which the former Wiscon‑
mental remediation.
sin jobs credit has been claimed, and not filled by
a member of a targeted group.
Line 2. Enter the development zones credit for job cre‑
ation or retention.
The above dollar amounts must be reduced by wage
subsidies the employer receives under the Wisconsin
Line 4. Enter the amount of development zones credit
Works trial job program for those jobs.
passed through from tax‑option (S) corporations, partner‑
ships, LLCs treated as partnerships, estates, or trusts.
Full‑time job means a regular, nonseasonal full‑time
The pass‑through credit is shown on Schedule 5K‑1 for
position in which an individual must work at least 2,080
shareholders of tax‑option (S) corporations, Schedule
hours per year, including paid leave and holidays. The
3K‑1 for partners and LLC members, and Schedule 2K‑1
individual must receive pay that is equal to at least
for beneficiaries of estates or trusts.
150% of the federal minimum wage and benefits that
are not required by federal or state law. A full‑time
Line 5. Add lines 3 and 4. This is the total current year
job does not include training before an employment
development zones credit. Enter the amount on line 5
position begins.
as an addition to income on the appropriate line of your
Wisconsin franchise or income tax return.
Member of a targeted group means a Wisconsin
resident who is certified as a member of one of the
Special Instructions for Pass‑Through Entities
following groups by a Jobs Service office of the Wis‑
consin Department of Workforce Development: • Tax‑option (S) corporations, partnerships, and
LLCs treated as partnerships: Prorate the develop‑
• A person who resides in an area designated by the ment zones credit on line 5 among the shareholders,
federal government as an economic revitalization partners, or members. Show the credit for each share‑
area. holder on Schedule 5K‑1 and for each partner or LLC
member on Schedule 3K‑1.
• A person who is employed in an unsubsidized job
but meets the eligibility requirements under sec.
• Estates and trusts: Prorate the development zones
49.145(2) and (3), Wis. Stats., for a Wisconsin
credit that otherwise would be entered on line 5 be‑
Works employment position.
tween the estate or trust itself and its beneficiaries in
• A person who is employed in a trial job, as defined proportion to the income allocable to each. Show only
in sec. 49.141(1)(n), Wis. Stats. the estate’s or trust’s portion of the credit on line 5.
Show the beneficiaries’ portion of the credit to the left
• A person who is eligible for child care assistance
of line 5. Label it “Beneficiaries’ portion” and show the
under sec. 49.155, Wis. Stats.
credit for each beneficiary on Schedule 2K‑1.
• A person who is a vocational rehabilitation refer‑
ral. Line 7. Add lines 5 and 6. This is the available develop‑
ment zones credit.
• An economically disadvantaged youth.
Required Attachments to Schedule DC
• An economically disadvantaged veteran.
To claim the development zones credit, you must file the
• A supplemental security income recipient.
following with Schedule DC:
• A general assistance recipient.
• A copy of your certification for tax benefits issued by the
• An economically disadvantaged ex‑convict. Department of Commerce.
• A qualified summer youth employee, as defined in
• A statement from the Department of Commerce verifying
26 USC 51(d)(7).
the amount of credit for environmental remediation and
• A dislocated worker, as defined in 29 USC for job creation or retention.
2801(9).
If the development zones credit is passed through from a
• A food stamp recipient.
tax‑option (S) corporation, partnership, LLC treated as a
partnership, estate, or trust, file a copy of your Schedule
5K‑1, 3K‑1, or 2K‑1 with Schedule DC instead of the above
information.
2

3. Property is placed in service in the earlier of the
Part II – Development Opportunity Zone following taxable years:
Investment Credit
(1) The taxable year in which, under your deprecia‑
General Instructions tion practice, the period for depreciation of the
property begins.
The investment credit is available only for businesses cer‑
(2) The taxable year in which you place the property
tified for tax benefits in a development opportunity zone.
in a condition or state of readiness and availability
The development opportunity zones are located in areas of
for a specifically assigned function.
Kenosha, Milwaukee, and Beloit.
Specific Instructions
The investment credit is the total of the following amounts:
Line 8a. Enter the purchase price of qualified property
A. 1.75% of the qualified investment in depreciable, tangible
you purchased during the taxable year and expensed
personal property that is expensed under section 179 of
under IRC section 179. If the property is used for less than
the Internal Revenue Code (IRC).
100% of its use in the conduct of business operations in a
B. 2.5% of the qualified investment in depreciable, tangible development opportunity zone, multiply the purchase price
personal property that is not expensed under IRC sec‑ by the percentage of use in the development opportunity
tion 179. zone and enter the result on line 8a.
In addition, you must meet the following requirements: Line 8b. Enter the purchase price of qualified property you
purchased during the taxable year and did not expense
• The credit may be claimed only by the purchaser of under IRC section 179. If the property is used for less than
the property, except that partners may claim a credit 100% of its use in the conduct of business operations in a
based on purchases by the partnership, members development opportunity zone, multiply the purchase price
may claim a credit based on purchases by the LLC by the percentage of use in the development opportunity
treated as a partnership, shareholders may claim a zone and enter the result on line 8b.
credit based on purchases by the tax‑option (S) cor‑
poration, and beneficiaries may claim a credit based Line 12. Enter the amount of development opportunity
on purchases by the estate or trust. zone investment credit passed through from tax‑option (S)
corporations, partnerships, LLCs treated as partnerships,
• You must purchase the property after you have been
estates, or trusts. The pass‑through credit is shown on
certified for tax benefits by the Department of Com‑
Schedule 5K‑1 for shareholders of tax‑option (S) corpora‑
merce. The date of purchase is the date on which
tions, Schedule 3K‑1 for partners and LLC members, and
ownership of the property transfers from the seller to
Schedule 2K‑1 for beneficiaries of estates or trusts.
the buyer; that is, the date on which the buyer receives
legal title to the property.
Line 13. Add lines 11 and 12. This is the total current year
• The property must be depreciable, tangible personal development opportunity zone investment credit. Enter
property. Machinery and equipment are examples of the amount on line 13 as an addition to income on the
tangible personal property. Land and land improve‑ appropriate line of your Wisconsin franchise or income
ments, such as buildings and other permanent struc‑ tax return.
tures and their components, are real property and do
not qualify for the credit. Special Instructions for Pass‑Through Entities
• In the case of used property, you may not have used • Tax‑option (S) corporations, partnerships, and
the property for business purposes at a location LLCs treated as partnerships: Prorate the develop‑
outside the development opportunity zone. For used ment opportunity zone investment credit on line 13
property acquired by a partnership, LLC treated as among the shareholders, partners, or LLC members.
a partnership, tax‑option (S) corporation, estate, or Show the credit for each shareholder on Schedule
trust, the entity may not have used the property for 5K‑1 and for each partner or LLC member on Sched‑
business purposes at a location outside the zone. ule 3K‑1.
• You cannot claim an investment credit for property
Estates and trusts: Prorate the development op‑
•
unless more than 50% of your use of it in the year
portunity zone investment credit that otherwise would
you place it in service is use in your business in a de‑
be entered on line 13 between the estate or trust
velopment opportunity zone. If the property is mobile,
itself and its beneficiaries in proportion to the income
the base of operations of the property must be at a
allocable to each. Show only the estate’s or trust’s
location in a development opportunity zone.
portion of the credit on line 13. Show the beneficia‑
ries’ portion of the credit to the left of line 13. Label it
Use of an automobile or other means of transporta‑
“Beneficiaries’ portion” and show the credit for each
tion is measured in miles. Measure the use of other
beneficiary on Schedule 2K‑1.
assets in terms of units of time, such as hours.
Line 15. Add lines 13 and 14. This is the available devel‑
opment opportunity zone investment credit.
3

4. Required Attachments to Schedule DC Property is placed in service in the earlier of the fol‑
lowing taxable years:
To claim the development opportunity zone investment
credit, you must file the following with Schedule DC:
(1) The taxable year in which, under your deprecia‑
tion practice, the period for depreciation of the
• A copy of your certification for tax benefits issued by
property begins.
the Department of Commerce.
(2) The taxable year in which you place the property
• A statement from the Department of Commerce verify‑
in a condition or state of readiness and availability
ing the amount of the investment and verifying that
for a specifically assigned function.
the property is qualified property.
Real Property
If the development opportunity zone investment credit is
passed through from a tax‑option (S) corporation, partner‑ Land and land improvements, such as buildings and
ship, LLC treated as a partnership, estate, or trust, file a other permanent structures and their components, are
copy of your Schedule 5K‑1, 3K‑1, or 2K‑1 with Schedule real property. To claim a credit for real property, you must
DC instead of the above information. meet the following requirements:
• If you made improvements to real property,
– Development Opportunity Zone, Agri‑
Part III
cultural Development Zone, or Airport (1) you began the physical work of construction, reha‑
Development Zone Capital Investment bilitation, remodeling, or repair, or any demolition
Credit or destruction in preparation for the physical work,
after the place where the property is located was
General Instructions designated a development opportunity zone or
agricultural or airport development zone, or
The capital investment credit is available only for busi‑
nesses certified for tax benefits in a development oppor‑ (2) you placed the completed project in service after
tunity zone located in areas of Milwaukee or Beloit or in you were certified for tax benefits.
an agricultural development zone or airport development
zone. Physical work doesn’t include preliminary activities
such as planning, designing, securing financing,
The capital investment credit is 3% of the following researching, developing specifications, or stabilizing
amounts: the property to prevent deterioration.
A. The purchase price of qualified depreciable, tangible • You must figure your credit for improving property
personal property. based only on the work done to the portion that is
used for certified business purposes. The cost of work
B. The amount expended to acquire, construct, rehabilitate,
done on the nonbusiness portion is excluded.
remodel, or repair real property in a development op‑
portunity zone, agricultural development zone, or airport
• If you acquired real property,
development zone.
(1) the property is not previously owned property,
Depreciable, Tangible Personal Property
and
Machinery and equipment are examples of tangible per‑
(2) you acquired the property after the place where
sonal property. To claim a credit for depreciable, tangible
the property is located was designated a devel‑
personal property, you must meet the following require‑
opment opportunity zone or agricultural or airport
ments:
development zone, or you placed the completed
project in service after you were certified for tax
• You must purchase the property after you have
benefits.
been certified for tax benefits by the Department of
Commerce. The date of purchase is the date on which
Previously owned property means real property that
ownership of the property transfers from the seller to
you or a related person owned during the two years
the buyer; that is, the date on which the buyer receives
prior to the Department of Commerce designating the
legal title to the property.
place where the property is located as a development
opportunity zone or agricultural or airport develop‑
• You cannot claim a credit for property unless more
ment zone. A related person is defined in IRC section
than 50% of your use of it in the year you place it in
267(b), except that any percentage of ownership is
service is use in your business in a development op‑
substituted for 50% ownership.
portunity zone or agricultural or airport development
zone. If the property is mobile, the base of operations
• You must reduce the amount expended to acquire
of the property must be at a location in a development
real property by a percentage equal to the percent‑
opportunity zone or agricultural or airport development
age of the area of the property not used for certified
zone.
business purposes.
Use of an automobile or other means of transporta‑
tion is measured in miles. Measure the use of other
assets in terms of units of time, such as hours.
4

5. Required Attachments to Schedule DC
Specific Instructions
To claim the development opportunity zone or agricultural
Line 16. Enter the purchase price of qualified depre‑
development zone capital investment credit, you must file
ciable, tangible personal property you purchased during
the following with Schedule DC:
the taxable year. If the property is used for less than
100% of its use in the conduct of business operations in
• A copy of your certification for tax benefits issued by
a development opportunity zone or agricultural or airport
the Department of Commerce.
development zone, multiply the purchase price by the
• A statement from the Department of Commerce veri‑
percentage of use in the development opportunity zone
fying the amount of the investment and verifying that
or agricultural or airport development zone and enter the
the property is qualified property.
result on line 16.
Line 17. Enter the amount expended during the taxable If the development opportunity zone or agricultural or air‑
year to acquire, construct, rehabilitate, remodel, or repair port development zone capital investment credit is passed
real property. If a portion of the real property is not used through from a tax‑option (S) corporation, partnership,
for certified business operations, reduce the amount LLC treated as a partnership, estate, or trust, file a copy
expended by the percentage attributable to nonbusiness of your Schedule 5K‑1, 3K‑1, or 2K‑1 with Schedule DC
purposes and enter the result on line 17. instead of the above information.
Line 20. Enter the amount of development opportunity – Recapture of Investment Credit
Part IV
zone or agricultural or airport development zone capital
General Instructions
investment credit passed through from tax‑option (S)
corporations, partnerships, LLCs treated as partnerships,
At the end of each taxable year, you must determine
estates, or trusts. The pass‑through credit is shown on
whether, during the year, you disposed of or stopped
Schedule 5K‑1 for shareholders of tax‑option (S) corpora‑
using in a development zone any property for which you
tions, Schedule 3K‑1 for partners and LLC members, and
claimed investment credit in a prior year.
Schedule 2K‑1 for beneficiaries of estates or trusts.
You must refigure the investment credit that you took in
Line 21. Add lines 19 and 20. This is the total current
an earlier year if:
year development opportunity zone or agricultural or
airport development zone capital investment credit. Enter
A. You disposed of the property before the end of the
the amount on line 21 as an addition to income on the
recapture period or the useful life of the property.
appropriate line of your Wisconsin franchise or income
tax return. B. You moved the property out of the development zone
or, if the property is mobile property, the base of op‑
Special Instructions for Pass‑Through Entities erations is moved out of the zone before the end of
the recapture period for the property.
• Tax‑option (S) corporations, partnerships, and
LLCs treated as partnerships: Prorate the devel‑ C. You changed the use of the property so that it no longer
opment opportunity zone or agricultural or airport qualifies as investment credit property. For example,
development zone capital investment credit on line 21 you must refigure the credit if you change the use of
among the shareholders, partners, or LLC members. property from business use to personal use, or if the
Show the credit for each shareholder on Schedule 5K‑ percentage of business use of the property decreases
1 and for each partner or LLC member on Schedule to 50% or less.
3K‑1.
Tax‑option (S) corporations, partnerships, LLCs treated
Estates and trusts: Prorate the development op‑
• as partnerships, estates, and trusts must give their
portunity zone or agricultural or airport development shareholders, partners, members, or beneficiaries the
zone capital investment credit that otherwise would information they need to refigure the credit.
be entered on line 21 between the estate or trust
itself and its beneficiaries in proportion to the income Specific Instructions
allocable to each. Show only the estate’s or trust’s
Line 24. Describe the property for which you must refigure
portion of the credit on line 21. Show the beneficia‑
the credit. Use a separate column for each item. If you
ries’ portion of the credit to the left of line 21. Label it
need more columns, attach other schedules with all the
“Beneficiaries’ portion” and show the credit for each
information shown on this form. Include the total from the
beneficiary on Schedule 2K‑1.
separate schedules on line 32.
Line 23. Add lines 21 and 22. This is the available de‑
Line 25. Enter the day, month, and year that the property
velopment opportunity zone or agricultural or airport
was available for service.
development zone capital investment credit.
Line 26. Enter the original estimated useful life or recov‑
ery period that you used to figure depreciation for the
property.
5

6. Line 28. Enter the day, month, and year that the property Line 32. If you used separate schedules to list additional
ceased to be qualified investment credit property. items on which you figured an increase in tax, include that
amount in the total on line 32.
Decrease in business use: If you take investment credit
Line 33. If you did not use all the credit you originally
for property and the percentage of business use in a
later year falls to 50% or less, you are treated as having figured, either in the year you computed it or in a car‑
disposed of the property. Business use is computed on a ryforward year, you do not have to recapture the amount
taxable‑year basis. A decrease in business use is deemed of the credit you did not use. In refiguring the credit for
to take place on the first day of the taxable year. the original credit year, be sure to take into account any
carryforwards from previous years that are now allowed
Line 29. Enter the number of full years from the date the because the recapture and recomputation of the original
property was placed in service until the date it ceased to credit made available some additional tax liability in that
be qualified investment credit property. Do not enter par‑ year. Figure the unused portion on a separate sheet and
tial years. If the property was held less than 12 months, enter it on this line. Do not enter more than the recapture
enter zero. tax on line 32.
Line 30. Enter the recapture percentage from the follow‑ Reminder: Be sure to adjust your current unused credit
ing table: to reflect any unused portion of the original credit that was
recaptured on this form.
Recovery Property
Line 34. See the instructions to your franchise or income
The recapture percentage for:
If number of full years
tax return for reporting the increase in tax.
on Schedule DC, 3‑year Other than 3‑year
line 29, is: property is: property is:
0 100 100
1 66 80
2 33 60
3 0 40
4 0 20
6